Instructions

ZOOM IN by clicking on the page. A slider will appear, allowing you to adjust your zoom level. Return to the original size by clicking on the page again.

MOVE the page around when zoomed in by dragging it.

ADJUST the zoom using the slider on the top right.

ZOOM OUT by clicking on the zoomed-in page.

SEARCH by entering text in the search field and click on "In This Issue" or "All Issues" to search the current issue or the archive of back issues
respectively.
.

PRINT by clicking on thumbnails to select pages, and then press the
print button.

SHARE this publication and page.

ROTATE PAGE allows you to turn pages 90 degrees clockwise or counterclockwise.Click on the page to return to the original orientation. To zoom in on a rotated page, return the page to its original orientation, zoom in, and
then rotate it again.

CONTENTS displays a table of sections with thumbnails and descriptions.

ALL PAGES displays thumbnails of every page in the issue. Click on
a page to jump.

Ten years ago Lehman Brothers
collapsed. The failure of such a large
institution—with its myriad connections
to all parts of the financial services industry—
suddenly upended the fundamental trust
that obligations would be honoured in the
financial system. Confidence was replaced
by doubt and a gathering storm instantly
became a crisis – or the GFC as it was
idiosyncratically called in Australia.
It was governments who first responded to the
crisis with fiscal stimulus packages, guarantees
and market interventions, and later by central
banks with increasingly innovative monetary
measures.
While some of its effects are still being felt,
this ten year anniversary provides a prompt to
reflect on the lessons the GFC has, or should
have, taught us. Especially what it means for
superannuation fund members and those in the
superannuation industry.
SO, WHAT HAVE WE LEARNT?
1. The most important lesson for the typical
superannuation fund member is a reminder
that equity investments can suffer sustained
negative returns from time to time but over
the long term, they generally deliver high
returns.
The short term impact was severe. The All
Ordinaries Index fell by 54 per cent from
October 2007 to March 2009. Even with the
benefit of diversification of investments, the
typical person in a balanced investment option
in their superannuation lost around 20 per
cent of their savings between
1 July 2007 and 30 June 2009. However, for
those who remained in a balanced option over
the ten year period to June 2018, investment
returns have added more than 85 per cent of
the original balance, while members in growth
options have seen their savings grow by more
than 90 per cent, even without additional
contributions.
the voice of super
Ten years on from the
GFC: lessons learnt
Dr Martin Fahy
ASFA Chief Executive
Superfunds October 2018